Wednesday, May 4, 2011

Chip tool maker Applied Materials (AMAT.O) will buy Varian Semiconductor Equipment Associates Inc (VSEA.O) for $4.9 billion in cash as it looks to meet rising demand from smartphone and solar equipment manufacturers. The deal values Varian at $63 per share, a 55 percent premium to its closing price on Tuesday. The company's stock jumped 51 percent to $61.25 in morning trading on Wednesday, while Applied Materials shares dipped less than 1 percent. Buying Varian will boost Applied Materials' earnings per share within a year and save up to $60 million annually as the red-hot market for gadgets like Apple's (AAPL.O) iPhone fuels demand for chip manufacturing tools, executives said. Varian makes ion implantation gear for making integrated circuits, or chips, found in all modern electronic gadgets. It is a complex process of implanting ions around which the structure of the chip is built.

Applied Materials, Inc. (Applied) provides manufacturing equipment, services and software to the global semiconductor, flat panel display, solar photovoltaic (PV) and related industries. Shares of AMAT fell by 0.92% or $-0.14/share to $15.1. In the past year, the shares have traded as low as $10.27 and as high as $16.93. On average, 17855400 shares of AMAT exchange hands on a given day and today's volume is recorded at 14286898.

Varian Semiconductor Equipment Associates, Inc. is a supplier of ion implantation systems, which the Company refers to as tools, used in the fabrication of integrated circuits, which it refers to as microchips or chips. Shares of VSEA traded higher by 51.06% or $20.705/share to $61.255. In the past year, the shares have traded as low as $24.40 and as high as $50.40. On average, 1218580 shares of VSEA exchange hands on a given day and today's volume is recorded at 20155364.

Apple Inc. (Apple) designs, manufactures and markets a range of personal computers, mobile communication and media devices, and portable digital music players, and sells a range of related software, services, peripherals, networking solutions, and third-party digital content and applications. Shares of AAPL traded higher by 0.59% or $2.06/share to $350.26. In the past year, the shares have traded as low as $199.25 and as high as $364.90. On average, 17238900 shares of AAPL exchange hands on a given day and today's volume is recorded at 4533686.

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